Hi! I’m Ms. Frugalette, a 45 year old single mom of a teen-aged daughter living in New England. I’m also a middle manager in the accounting department of a publicly-traded company where I’ve worked for almost 20 years. I’ve dabbled in frugal living at various times in my life but I really let lifestyle inflation get the best of me as I tried to provide a life for me and my daughter.

I’ve decided to get serious about pursuing FIRE (financial independence/retire early) because I’ve spent too much of my life working at a career I’ve never really loved. I have interests and hobbies that I’d love to have more time to pursue.

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Apr 27 Historical Financial Data - 2016 and Q1 2017

I read Your Money or Your Life many years ago but I remember that it started with an instruction to first take a look at where I’ve been before I start focusing on the future. I have all my financial data in Mint so I took a snapshot of my assets and my debt for the past two+ years. I also reviewed my expenses but that will be another post.

Here is my net asset position from 12/31/2014 - 3/31/2017:

I made some progress over the two+ plus years but I could have done better. How will be obvious shortly.

The next graph shows my assets over the same period:

I valued my house using the Zillow estimate less 5%. As I mentioned, the house still isn’t worth what I paid for it in 2005 ($325,000). My retirement balance has been going up steadily due to contributions and earnings. I only contributed 6% of my income even though my employer matches 50% of my contribution up to 10%. I know, I left money on the table. I fixed that as of April 2017. My cash balance is low and flat. That’s the one I’m focusing on building up now.

Here are my debt balances over the same period:

It looks like a roller coaster. I had to do separate charts for my mortgage vs my other debts so you can really see what’s been going on.

My mortgage:

I refinanced during the summer of 2016 and lowered my mortgage payment by $132. I also rolled the closing costs and a monthly payment into the balance which is why it increased.

Here are my other debts:

A 401(k) loan! What was I thinking? That is my biggest regret. I originally took the loan out to pay for a private school for my daughter. She was really struggling and everyone assured me that this school would really make a difference for her. It did in some ways but she is currently in an alternative public high school that is way better for her. I didn’t have the cash because I was still overspending. The school was only $20k but I also rolled in some credit card debt. I know.

I made it worse. In September 2016, I refinanced the 401(k) loan to roll in some more credit card debt. I really should have known better.

This loan is the first loan I have to pay off (since I no longer carry a credit card balance). The interest rate is higher than my car loan but, more importantly, it’s a huge risk. If I were to lose my job or voluntarily leave my employer to pursue a new opportunity I would have 60 days to pay the loan back to my 401(k). If I can’t, it would be considered an early withdrawal and I would have to pay all the taxes and penalties associated with an early withdrawal, probably equal to half the carrying value of the loan, at least. It’s a sword of Damocles hanging over my head. There was a round of layoffs in January and I’m so glad I survived. This loan has to go.

Second big no-no is something I just did last month! I have been driving a 2008 Honda CRV that I bought new (and financed). There is no school bus to my daughter’s school so I told her I would give her my car when she got her license. I did and I bought a new car for myself - a 2017 Subaru Forester. I plan to pay the loan off as quickly as I can but I can’t really say I regret it even though I know it’s stupid to finance a car. I love my car and I expect it to be as reliable and long-lasting as the CRV.

I obviously had trouble with credit card debt over the past couple years. I rolled the balances in a 401(k) loan twice and I also used almost my entire bonus in March 2016 to pay off credit card balances. Even before I decided to go all-in with FIRE this month, I decided to start paying off my credit card balances every pay period (every two weeks) and it has worked so far. I was ready to stop using them all together (and forego rewards) if I couldn’t get the spending under control. The balances you see in 2017 result from pay periods and month ends not lining up.